McKinsey & Company, a global management consulting firm, recommends that its clients evaluate the total cost of offshoring to determine if current economic conditions warrant bringing some manufacturing back to the States. See our blogs “Boeing 787 Dreamliner Illustrates the Dangers of Offshoring” and “GE, NCR Lead “Reshoring” Trend” for more perspectives on this issue.

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Time to Rethink Offshoring?

Changing economic conditions may have undermined some of the benefits of offshoring. For managers of global supply chains, this could be the time to reevaluate.

September 2008 • Ajay Goel, Nazgol Moussavi, and Vats N. Srivatsan
Retrieved March 15, 2012 https://www.mckinseyquarterly.com/Time_to_rethink_offshoring_2190
Source: Business Technology Office

The production of high-tech goods has moved steadily from the United States to Asia over the last decade. The reasons are familiar: lower wages, a stable global economy, and rapidly growing local markets. These factors combined to make nations such as China and Malaysia favored manufacturing locations. In the last two years, however, the favorable economic winds that carried offshoring forward have turned turbulent. The new conditions are undermining some of the factors that made manufacturers of every stripe, including those in high tech, move production offshore. Continue reading McKinsey Quarterly: Time to Rethink Offshoring →